Bajaj Finance aims Rs 13,000 cr AUM in FY12

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Bajaj Finance aims Rs 13,000 cr AUM in FY12

Bajaj Finance, the largest non-banking finance company in terms of consumer durable loans, is aiming to achieve a loan book of Rs 13,000 crore by the end of March, 2012. According to Rajeev Jain, CEO, Bajaj Finance, the strong loan growth in consumer durable and two wheeler segments supported its Q3 net profit to grow at 68% year-on-year.

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Moneycontrol Bureau 

Bajaj Finance , the largest non-banking finance company in terms of consumer durable loans, is aiming to achieve a loan book of Rs 13,000 crore by the end of March, 2012. According to Rajeev Jain, CEO, Bajaj Finance, the strong loan growth in consumer durable and two wheeler segments supported its Q3 net profit to grow at 68% year-on-year.

"We would like to grow our book across the sectors. Essentially, we will diversify our loan exposure with a 30% cap on each segment. We are currently restraining our growth on construction equipment loans due to some ongoing problems in the sector. We would revive it as and when things improve," he told Moneycontrol.com.

The NBFC has seen an increase of 125-150 basis points on an average in the cost of borrowings. However, its net interest income (NII) rose 39% to Rs 396 crore in Q3, suggesting that it has successfully passed on the higher interest cost to its borrowers.

Its asset under management stood at Rs 11,919 crore as on December 31, 2011; as against Rs 6,868 crore a year back (a sharp rise of 74% Y-o-Y). The commercial segment contributed the most with a whopping rise of 174% y-o-y to 2,001 crore. The other two were consumer and SME business registering Y-o-Y growth of 53% and 71% respectively.

Meanwhile, the company has just launched a new loan product specially designed for small and medium enterprises (SMEs). It is christened as "flexisaver".

"SME players have cyclical cash flows. This new product will help them draw the loan amount in parts as when they require it and the interest will be levied only from the day of withdrawal. Hence, it will enable them to save interest costs," Jain said.

For example, if the company sanctions a loan of Rs 1 crore to a local retailer. He can draw it in parts. He may draw Rs 40 lakh in his pick of business when he needs the money most and later repay it in parts and again can claim the rest of loan amount in parts as per requirement.

Also read:

Bajaj Fin Q3 net up 58% at Rs 120cr on higher loan growth

Saikat Das

saikat.das@network18online.com